M Stanley Reports Year-over-Year Changes in NP and PPOP for Chinese Banks in Q2 2025 (Table)
Overview of Chinese Bank Stocks in 2Q25
- Net Profit and PPOP Changes: Morgan Stanley's report highlights the year-over-year (YoY) changes in net profit and pre-provision operating profit (PPOP) for major Chinese banks in the second quarter of 2025.
Individual Bank Performance
ICBC (01398.HK): Reported a net profit decrease of 0.693% with a PPOP increase of 4.0%. Short selling reached $229.31 million, with a ratio of 15.609%.
CCB (00939.HK): Experienced a slight net profit increase of 0.533% and a PPOP growth of 6.8%. Short selling amounted to $389.97 million, with a ratio of 19.572%.
BANK OF CHINA (03988.HK): Showed a net profit increase of 1.174% and a modest PPOP rise of 0.8%. Short selling was $355.19 million, with a ratio of 26.314%.
ABC (01288.HK): Reported a net profit decline of 0.952% and a PPOP increase of 0.3%. Short selling reached $222.11 million, with a ratio of 28.745%.
BANKCOMM (03328.HK): Experienced a net profit drop of 1.040% while PPOP increased by 4.6%. Short selling was $28.66 million, with a ratio of 23.485%.
CM BANK (03968.HK): Reported a significant net profit decrease of 2.000% and a PPOP increase of 4.4%. Short selling reached $306.89 million, with a ratio of 30.029%.
PSBC (01658.HK): Showed a net profit increase of 3.327% but a PPOP decline of 6.6%. Short selling was $111.24 million, with a ratio of 33.649%.
MINSHENG BANK (01988.HK): Reported a net profit decrease of 1.126% and a significant PPOP decline of 12.4%. Short selling reached $40.41 million, with a ratio of 26.916%.
CITIC BANK (00998.HK): Experienced a net profit drop of 1.293% while PPOP increased by 3.8%. Short selling was $26.88 million, with a ratio of 9.756%.
CEB BANK (06818.HK): Reported a net profit decrease of 0.571% and a PPOP increase of 4.4%. Short selling reached $8.92 million, with a ratio of 25.677%.
CQRC BANK (03618.HK): Showed a net profit increase of 0.521% but a PPOP decline of 3.4%. Short selling was $23.12 million, with a ratio of 29.177%.
Market Insights
Short Selling Trends: The report indicates varying levels of short selling across different banks, with PSBC and ABC showing the highest short selling ratios at 33.649% and 28.745%, respectively.
Overall Market Sentiment: The mixed performance in net profit and PPOP among the banks suggests a cautious market sentiment, with some banks experiencing growth while others face declines.
Related News
- G Sachs Prediction: Goldman Sachs anticipates that the upcoming HSI quarterly review will reveal the largest passive inflows in sectors such as consumer, software, and automotive stocks.
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CCB and China Taiping Strengthen Business Collaboration
Meeting Overview: Zhang Jinliang, Chairman of CCB, met with Yin Zhaojun, Chairman of China Taiping Insurance Group, to discuss enhancing business cooperation between their organizations.
Areas of Cooperation: The two parties highlighted their existing collaboration in insurance agency, asset custody, corporate annuities, and financial markets, aiming to innovate and improve their joint services.
Future Goals: Both leaders expressed a commitment to respond to market demands and develop a new ecosystem for bank-insurance collaboration in line with the "15th Five-Year Plan."
Strategic Focus: China Taiping's Yin emphasized the need to expand cooperation into strategic investment, wealth management, pension finance, and overseas business, while establishing regular communication for high-quality development.
<Full-day Summary> HSI Falls 325 Points; HSTI Declines 59 Points; AIA Drops More Than 5%; ZTO EXPRESS-W, BOC HONG KONG, SHK PPT, REALORD GROUP, SANY INT'L Reach New Peaks; Market Turnover Increases
Market Performance: The Hang Seng Index (HSI) fell by 325 points (1.2%) to 26,559, while the Hang Seng Tech Index (HSTI) and the Hang Seng China Enterprises Index (HSCEI) also experienced declines, with market turnover reaching $247.87 billion.
Active Heavyweights: Major stocks like Alibaba, Meituan, and Tencent saw significant drops, with Alibaba closing down 2.9% at $155, while Xiaomi and CCB managed slight gains.
Notable Movers: AIA experienced a sharp decline of 5.5%, while Li Auto and Mengniu Dairy saw increases of 3.6% and 3%, respectively, with several stocks hitting new highs.
Short Selling Trends: High short selling ratios were noted for several companies, including Ping An and CCB, indicating increased market speculation and potential bearish sentiment.
G Sachs Evaluates Ratings and Price Targets for Chinese Banks (Table)
ICBC Performance: ICBC shares decreased by 1.233%, with a short selling ratio of 16.197% and a neutral rating of 5.8.
Bank of China Update: Bank of China shares fell by 1.071%, with a short selling ratio of 12.697% and a buy rating of 4.94.
CM Bank Insights: CM Bank shares rose by 0.418%, with a significant short selling ratio of 31.262% and a buy rating of 52.96.
Market Trends: Other banks like CCB and ABC also experienced slight declines, while PSBC maintained a buy rating despite a minor drop in share price.
G Sachs: Potential Capital Infusion into ICBC/ABC Could Result in Up to 7% EPS Dilution
Capital Injection Plans: Chinese authorities are set to inject RMB300 billion into two major state-owned banks, ICBC and ABC, as reported by Goldman Sachs, which did not confirm the rumor but assessed its potential impact.
Impact on Financial Metrics: If the capital injection occurs, it could lead to an estimated 4-7% dilution in EPS and a maximum of 2% dilution in BVPS, while potentially increasing the CET1 ratio by 54 to 61 basis points.
Stock Selection Preferences: Goldman Sachs favors banks with solid balance sheets that have completed capital replenishment, such as CCB, Bank of China, and CM Bank, which are seen as having greater potential for dividend increases.
Current Ratings and Uncertainties: Goldman Sachs maintains a Neutral rating on ICBC and ABC with target prices of HKD5.8 and HKD4.95, respectively, citing uncertainties regarding the capital injection's size, timing, and valuation.
Report: ICBC and ABC Investment Physical Gold Products Sold Out
Investment Products Availability: Several investment physical gold products from ICBC and ABC are marked as "temporarily out of stock," with some completely sold out, while other banks like Bank of China, CCB, and Bankcomm still have their physical precious metals series available.
Short Selling Data: The short selling figures for ICBC, ABC, Bank of China, CCB, and Bankcomm indicate varying levels of short selling activity, with ABC having the highest short selling ratio at 14.597%.
<Full-day Summary> HSI Falls 580 Points; HSTI Declines 122 Points; CCB and XIAOMI Drop Over 3%; NEW ORIENTAL, SHK PPT, HUABAO INTL, ZOOMLION, and HANG LUNG GROUP Reach New Peaks; Market Turnover Increases
Market Performance: The Hang Seng Index (HSI) fell by 580 points (2.1%) to 27,387, with significant declines in other indices, including HSTI and HSCEI, and a market turnover of $301.61 billion.
Active Heavyweights: Major stocks like CCB, Xiaomi, Tencent, and Alibaba experienced notable declines, with short selling ratios indicating increased market activity against these stocks.
Significant Declines: CSPC Pharma, Chinahongqiao, and Zijin Mining saw substantial drops of over 9%, reflecting a broader trend of falling stock prices among HSI and HSCEI constituents.
Gainers and New Highs: New Oriental and Huabao International were among the few gainers, with New Oriental hitting a new high, while several other stocks, including SD Gold and Jiangxi Copper, faced significant losses.
CCB and China Taiping Strengthen Business Collaboration
Meeting Overview: Zhang Jinliang, Chairman of CCB, met with Yin Zhaojun, Chairman of China Taiping Insurance Group, to discuss enhancing business cooperation between their organizations.
Areas of Cooperation: The two parties highlighted their existing collaboration in insurance agency, asset custody, corporate annuities, and financial markets, aiming to innovate and improve their joint services.
Future Goals: Both leaders expressed a commitment to respond to market demands and develop a new ecosystem for bank-insurance collaboration in line with the "15th Five-Year Plan."
Strategic Focus: China Taiping's Yin emphasized the need to expand cooperation into strategic investment, wealth management, pension finance, and overseas business, while establishing regular communication for high-quality development.
<Full-day Summary> HSI Falls 325 Points; HSTI Declines 59 Points; AIA Drops More Than 5%; ZTO EXPRESS-W, BOC HONG KONG, SHK PPT, REALORD GROUP, SANY INT'L Reach New Peaks; Market Turnover Increases
Market Performance: The Hang Seng Index (HSI) fell by 325 points (1.2%) to 26,559, while the Hang Seng Tech Index (HSTI) and the Hang Seng China Enterprises Index (HSCEI) also experienced declines, with market turnover reaching $247.87 billion.
Active Heavyweights: Major stocks like Alibaba, Meituan, and Tencent saw significant drops, with Alibaba closing down 2.9% at $155, while Xiaomi and CCB managed slight gains.
Notable Movers: AIA experienced a sharp decline of 5.5%, while Li Auto and Mengniu Dairy saw increases of 3.6% and 3%, respectively, with several stocks hitting new highs.
Short Selling Trends: High short selling ratios were noted for several companies, including Ping An and CCB, indicating increased market speculation and potential bearish sentiment.
G Sachs Evaluates Ratings and Price Targets for Chinese Banks (Table)
ICBC Performance: ICBC shares decreased by 1.233%, with a short selling ratio of 16.197% and a neutral rating of 5.8.
Bank of China Update: Bank of China shares fell by 1.071%, with a short selling ratio of 12.697% and a buy rating of 4.94.
CM Bank Insights: CM Bank shares rose by 0.418%, with a significant short selling ratio of 31.262% and a buy rating of 52.96.
Market Trends: Other banks like CCB and ABC also experienced slight declines, while PSBC maintained a buy rating despite a minor drop in share price.
G Sachs: Potential Capital Infusion into ICBC/ABC Could Result in Up to 7% EPS Dilution
Capital Injection Plans: Chinese authorities are set to inject RMB300 billion into two major state-owned banks, ICBC and ABC, as reported by Goldman Sachs, which did not confirm the rumor but assessed its potential impact.
Impact on Financial Metrics: If the capital injection occurs, it could lead to an estimated 4-7% dilution in EPS and a maximum of 2% dilution in BVPS, while potentially increasing the CET1 ratio by 54 to 61 basis points.
Stock Selection Preferences: Goldman Sachs favors banks with solid balance sheets that have completed capital replenishment, such as CCB, Bank of China, and CM Bank, which are seen as having greater potential for dividend increases.
Current Ratings and Uncertainties: Goldman Sachs maintains a Neutral rating on ICBC and ABC with target prices of HKD5.8 and HKD4.95, respectively, citing uncertainties regarding the capital injection's size, timing, and valuation.
Report: ICBC and ABC Investment Physical Gold Products Sold Out
Investment Products Availability: Several investment physical gold products from ICBC and ABC are marked as "temporarily out of stock," with some completely sold out, while other banks like Bank of China, CCB, and Bankcomm still have their physical precious metals series available.
Short Selling Data: The short selling figures for ICBC, ABC, Bank of China, CCB, and Bankcomm indicate varying levels of short selling activity, with ABC having the highest short selling ratio at 14.597%.
<Full-day Summary> HSI Falls 580 Points; HSTI Declines 122 Points; CCB and XIAOMI Drop Over 3%; NEW ORIENTAL, SHK PPT, HUABAO INTL, ZOOMLION, and HANG LUNG GROUP Reach New Peaks; Market Turnover Increases
Market Performance: The Hang Seng Index (HSI) fell by 580 points (2.1%) to 27,387, with significant declines in other indices, including HSTI and HSCEI, and a market turnover of $301.61 billion.
Active Heavyweights: Major stocks like CCB, Xiaomi, Tencent, and Alibaba experienced notable declines, with short selling ratios indicating increased market activity against these stocks.
Significant Declines: CSPC Pharma, Chinahongqiao, and Zijin Mining saw substantial drops of over 9%, reflecting a broader trend of falling stock prices among HSI and HSCEI constituents.
Gainers and New Highs: New Oriental and Huabao International were among the few gainers, with New Oriental hitting a new high, while several other stocks, including SD Gold and Jiangxi Copper, faced significant losses.
